SØRENSEN PARADOX: IN WHAT DIRECTION GOES FISCAL POLICY IN CAPITAL AND LABOR AREA?

Paula LAZĂRAuthor-Email:

Studii si Cercetari de Calcul Economic si Cibernetica Economica Description: This is the official journal of the Journal Studii si Cercetari de Calcul Economic si Cibernetica Economica, 2015, vol. 1-2, 76-87

Abstract: In a world without borders production factors can “run” freely from one territory to another and choose to settle wherever the advantages overrun the fiscal burden. For the European Union seen as a unitary territory, fiscal competition can create real problems concerning the “runaway” production factors. This paper aims to underline that nowadays the European fiscal policy is unfair – applying different burdens to different production factors, creates and carries on discrepancies between the production factors and actually sustains the development gap between member states. Based on a 13 year analysis the paper will prove that between capital and work force, the first is the fiscal policy “protégé” and European member state will shift the fiscal burden from capital towards the work force.

Keywords: production factors; fiscal policy; paradox (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:aes:sccece:v:1-2:y:2015:i::p:76-87

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